Yacht charters in France - about to get more expensive

by Sail-World Cruising round-up on 24 Nov 2012 Chartering a yacht in France is just about to get more expensive. But then, that's because it had been cheaper than in its neighbours Italy and Spain. There are some strange anomalies shown up by the economic crisis that has afflicted the EU since 2008 and not the least of them is in the yacht chartering sector.

France has, in the recent past, greatly benefitted by allowing charter yachts working in and out of France to be exempt from 19.6 % VAT the country levies.

Those representing the industry have long argued against the implementation of the tax saying it would have a negative impact on the charter sector. But now it seems they will have to change their rules to conform with neighbours in Spain and Italy.

The impending change is being brought about by the the European Commission who have formally requested France to remove the tax exemption on luxury yacht charters warning it would refer the matter to the European Court of Justice if France did not comply within two months.

Citing the regulations, the statement adds, 'The VAT Directive provides for the exemption from VAT for certain transactions involving boats. However, this exemption does not apply to luxury boats used by individuals for recreational purposes.'

The Commission warns that it would refer the case to the European Court of Justice if France does not comply within two months.

'The VAT Directive provides for the exemption from VAT for certain transactions involving boats. However, this exemption does not apply to luxury boats used by individuals for recreational purposes,' said a statement from the European Commission.